NSE sets panel to look into flash trade profits

The National Stock Exchange (NSE) has set up a subcommittee to look in to the profits made by brokers during the flash trade last year and the payment to the brokers has been withheld.

Market sources say the brokers, mostly beneficiaries, who had taken positions during the flash trade of October 5 last year, had written to NSE on October 9.

“In the letter, the brokers requested out-of-exchange settlement and asked NSE to withhold the payment till the issue is resolved. The NSE has formed a sub-committee to resolve the issue,” said a person close to the development.

On October 5, Nifty had lost 15.5% after the flash crash following erroneous orders placed by Emkay Global. NSE’s circuit filter was triggered at 10%.

“NSE has not reached any decision yet,” the NSE spokesperson said when asked about annulling the trades done by brokers during the flash crash.

Meanwhile, the brokers, who have benefited from the flash crash said that the NSE had earlier promised that the transactions done during the flash trade would not be annulled.

A person close to the development said no such agreement had been reached between the NSE and the brokers.